HOUSE SPECIAL SESSION COMMITTEE ON BUDGET

Second Special Session

 

February 25, 2002   Hearing Room F

9:00 p.m. Tape 3

 

MEMBERS PRESENT:            Rep. Ben Westlund, Chair

Rep. Susan Morgan

Rep. Kurt Schrader

Rep. Lane Shetterly

 

MEMBER EXCUSED:            Rep. Jan Lee

 

STAFF PRESENT:                  Adrienne Sexton, Legislative Analyst

                                                Larry Niswender, Principal Legislative Analyst

                                                Dick Yates, Legislative Revenue Office

Annetta Mullins, Committee Assistant

 

MEASURE/ISSUES HEARD:            Public Hearing and Work Session

HB 4035

HB 4033

 

 

These minutes are in compliance with Senate and House Rules.  Only text enclosed in quotation marks reports a speaker’s exact words.  For complete contents, please refer to the tapes.

 

TAPE/#

Speaker

Comments

TAPE 3, A

003

Chair Westlund

Calls meeting to order at 9:05 p.m. and opens a public hearing on HB 4035.

HB 4035 - PUBLIC HEARING

004

Chair Westlund

Determines no one wishes to testify on HB 4035.  Closes the public hearing and opens a work session on HB 4035.

HB 4035 - WORK SESSION

016

Chair Westlund

Recesses meeting at 9:06 p.m.

016

Chair Westlund

Reconvenes meeting at 9:10 p.m.

019

Larry Niswender

LFO.  Submits Revenue Impact Statement (EXHIBIT A).  States the bill is identical to the bill passed in the first special session. 

032

Rep. Schrader

Asks if centralized voter registration will be a reservation in the E Fund. 

036

Niswender

Explains that in the last special session the disappropriation bill established a reservation of $2 million in the General Purpose E Fund for the centralized voter registration system and it is the expectation that will be repeated in the budget report.

039

Chair Westlund

Comments that it is also contingent on federal funds.

 

 

 

042

Nancy Baker-Krofft

Salem resident, teacher in Oregon, and parent of son in school.  States that cuts to education are not acceptable.  In many cities, schools have been cut to the bone.  Also sees the terrible choices the Salem School District is trying to make based on the cuts that are planned.  States there must be some taxes we can come up with.  If we take money from our rainy day funds and next year it rains, we will be very wet. 

064

Rep. Morgan

MOTION:  Moves HB 4035 to the floor with a DO PASS recommendation.

067

 

VOTE:  4-0-1

EXCUSED:  1 - Lee

 

Chair Westlund

Hearing no objection, declares the motion CARRIED.

REP. WESTLUND will lead discussion on the floor.

 

070

Chair Westlund

Opens a public hearing on HB 4033.

HB 4033 - PUBLIC HEARING

075

Chair Westlund

Informs the committee that he has a rough draft of the amendment and the committee is waiting for the amendments from Legislative Counsel.

083

Chair Westlund

Determines no one wishes to testify on HB 4033.  Closes the public hearing and opens a work session on HB 4033.

HB 4033 – WORK SESSION

085

Chair Westlund

Recesses the meeting at 9:18 p.m. to await the arrival of the amendments to HB 4033.

086

Chair Westlund

Reconvenes the meeting at 9:20 p.m..

082

Dick Yates

Legislative Revenue Office.  Explains graph (EXHIBIT B).  States that he used information presented during the regular session on estimated revenues from the Master Settlement Agreement and that is the height of the bars, the total revenue that is forecast to be received by the State of Oregon pursuant to the Master Settlement Agreements.  About $15.6 million annually will be required if the OSU bonding goes through.  The dark area in the middle of the chart is the estimate of the additional payments that would be required to be pledged for a $200 million issue to provide funds to be transferred to the State School Fund.  Adds that how it ends up depends on how the Treasury eventually structures the issue and over the period of issue.  This is simply one proposal Treasury is considering.  It would take out about $33 million up to $46 million a year from 2004 to 2012.  The balance is the Master Settlement expected payments that would be available during those years for legislative appropriation.

123

Rep. Schrader

Asks what the debt service would be for the first three years.

 

Yates

Responds it is about $80 million less $35 million and less another $15 million.  It is about $30 million.  It would be about  $15 million for OHSU and $33 million for the State School Fund. 

146

Chuck Smith

Oregon State Treasury.  Comments the numbers presented by Yates are correct.    

143

Rep. Shetterly

Comments this comes into play only if the voters reject Measure 11 and the HJR 75 referral.

166

Smith

Explains types of bonds. 

 

Rep. Shetterly

Advises members he has been notified that the amendments will arrive in 15 minutes.

181

Chair Westlund

Recesses meeting at 9:28 p.m.

181

Chair Westlund

Reconvenes meeting at 10:08 p.m. and announces that the committee has received the amendments for HB 4033 (EXHIBIT C).

206

Rep. Shetterly

Explains HB 4033-1 amendments (EXHIBIT C).  States that Measure 11, the OHSU capital bond referral, is going out on the ballot.  Under that referral there is a fallback that says if the referral for general obligation bonds does not pass, the Treasurer is directed to issue tobacco revenue bonds.  These are also tobacco revenue bonds.  The purpose of the amendments is to bring HB 4033 together with SB 832 so that if revenue bonds are issued under this bill and if they need to be issued under SB 832, they will be in parity—of equal priority so that one does not have precedent over the other for any purpose.  That will help bring the best rates for both so they are not selling the bonds to bond holders whose interest may become subordinate to some later issue of bonds. 

228

Harrison Conley

Legislative Counsel.  States he is comfortable with Rep. Shetterly’s explanation of the amendments.  States that because we are dealing with SB 832, which is already in effect, and given the title of this bill, we could not change the superiority clause in SB 832 as it relates to any subsequent revenue bonds that may be authorized by the legislature.  These bonds would be in parity with the SB 832 bonds should they be issued.  These bonds will be in parity with any subsequent bonds issued and secured by the same revenue stream.  These would not be in parity with any subsequent revenue bonds the legislature might authorize.

257

Kate Richardson

State Treasury.  States the HB 4033-1 amendments are the work of their staff and Bar counsel and they believe they should work with the prior bill.

267

Rep. Shetterly

MOTION:  Moves to ADOPT HB 4033-1 amendments.

 

 

VOTE:  3-0-2

EXCUSED:  2 – Lee, Schrader

267

Chair Westlund

Hearing no objection, declares the motion CARRIED.

REP. WESTLUND will lead discussion on the floor.

 

270

Rep. Shetterly

MOTION:  Moves HB 4033 AS AMENDED to the floor with a DO PASS AS AMENDED recommendation.

270

 

VOTE:  3-0-2

EXCUSED:  2 – Lee, Schrader

 

Chair Westlund

Hearing no objection, declares the motion CARRIED.

REP. SHETTERLY will lead discussion on the floor.

 

258

Chair Westlund

Adjourns meeting at 10:13 p.m. until approximately 9:30 a.m. on Feb. 26.

 

 

 

Submitted By,                        Reviewed By,

 

 

 

Annetta Mullins,                        Adrienne Sexton,

Committee Assistant                        Legislative Analyst

 

EXHIBIT SUMMARY

 

A – HB 4035, Revenue Impact Statement, staff, 1 p

B – HB 4033, Securitization graph, staff, 1 p

C – HB 4033, HB 4033-1 amendments, staff, 8 pp